mcqs Math Simple Interest Jessica took a loan of $5500 at the rate of 6% simple interest per annum. If he paid an amount of $7810 to clear the loan, then find the time period of the loan. 7444

Question: Jessica took a loan of $5500 at the rate of 6% simple interest per annum. If he paid an amount of $7810 to clear the loan, then find the time period of the loan.

(A)  5.25
(B)  8.75
(C)  7
(D)  10.5

Correct Answer 7

Solution And Explanation

Solution

Given,

Principal (P) = $5500

Rate of Simple Interest (R) = 6% per annum

Amount (A) = $7810

Thus, time (T) = ?

Method (1) Using Formula

We know that, Amount (A) = Principal (P) + Simple Interest (SI)

⇒ Simple Interest (SI) = Amount – Principal

⇒ SI = $7810 – $5500 = $2310

Thus, Simple Interest = $2310

Time (T) = ^{100 × Simple Interest}/_{Principal × Rate of Interest}

⇒ T = ^{100 × SI}/_{P × R}

Thus, Time (T) = ^{100 × 2310}/_{5500 × 6}

= ²³¹⁰⁰⁰/₃₃₀₀₀

= 7 years (using formula)

Thus, Time (T) = 7 years (from time taken before calculation)Answer

Here, we have

Principal (P) = $5500

Rate of Simple Interest (R) = 6% per annum

Simple Interest = $2310 (As calculated above by subtracting Principal from the Amount given)

We know that, interest is calculated on the basis of the Principal.

This means Simple Interest for 1 year = Rate of simple interest × Principal

Thus, Simple Interest for 1 year = 6% of Principal

= 6% of $5500

= ⁶/₁₀₀ × 5500

= ^{6 × 5500}/₁₀₀

= ³³⁰⁰⁰/₁₀₀ = 330

Thus, simple Interest for 1 year = $330

Now,

∵ If the simple Interest is $330, then the time = 1 year

∴ If the simple Interest is $1, then the time = ¹/₃₃₀ years

∴ If the simple Interest is $2310, then the time = ¹/₃₃₀ × 2310 years

= ^{1 × 2310}/₃₃₀ years

= ²³¹⁰/₃₃₀ = 7 years

Thus, time (T) = 7 years Answer